The New History of American Capitalism

Historians are taking a new look at capitalism in light of its adoption in most of the developed world. From the edited volume American Capitalism: New Histories, by Sven Beckert and Christine Desan, the authors delve into the evolution of these new historic views.

Since the start of the 2000s, historians have renewed their interest in capitalism, two Harvard professors observe in their new book, American Capitalism: New Histories. One of the primary contributing factors for this, according to Sven Beckert and Christine Desan, is the expanding tide of market forces following the fall of the Berlin Wall, the collapse of the Soviet Union, and the end of the Cold War. “Capitalism of a wide variety of institutional and ideological stripes, now characterizes all developed countries,” they observe.

In this excerpt from the book’s introduction, Beckert and Desan look to how scholars in history, law, and political science are redefining capitalism in light of the American experience. Essayists write on such diverse subjects as markets, selling of slave clothing, the Gilded Age, women’s rights, money and finance, risk management in the twentieth century, and modern agriculture.

The New History of American Capitalism

By Sven Beckert and Christine Desan

The new history of American capitalism builds on these disciplinary trends in history, economics, political science, and law; indeed, it would be unimaginable without them. At the same time, it represents a distinctive departure.

First—and most basically—the history of American capitalism, along with the essays gathered here, reinstalls political economy as a category for analysis. Economic life, all the authors agree, is crucial to understanding the history of the United States. But rather than taking the subject as given, they explore it as politically constituted. If “the market” is neither a discrete phenomenon nor marginal to human experience, then basic structures of governance become important. Rather than assuming that exchange for profit naturally produces a particular infrastructure for transactional activity, new scholarship asks what forces shape modern patterns of economic activity and how those patterns sort people and resources. Instead of reproducing conventional dichotomies, current historians of American capitalism contest the line between public and private that had seemed to neatly divide politics and markets, states and economies.

"The new history of American capitalism targets the lived experience of people and groups as they assimilate—and reshape—the political economy they engage"

The connection between markets and political order has been a perennial topic for writers on capitalism, from Progressive historians who argued that elites used the advantages of wealth to skew political structures in their favor to consensus historians who found more widespread support for a market-oriented liberal political order. Echoes of this debate lingered through the late twentieth-century scholarship that sought to locate and date the American “market revolution,” contending over the visions of political voice and material development embedded in agrarian, “republican,” and “liberal” orientations. Capitalism scholarship revisits many traditional questions with the tools generated by the innovation of past decades, including the relationship between money and power, commerce and politics, exchange and social status. Its effort is to find new ways of exploring how institutions, political movements, and legal formations like debt, contract, and property come into being and inflect material and ideological life.

The study of finance as a concept constructed by law and naturalized by economics is one theme that the new history of American capitalism emphasizes and that exemplifies the great possibilities of understanding capitalism as a political economy. Thomas Piketty locates the roots of growing inequality in the economic returns to capital and stresses the political stakes of distributive justice. “If democracy is someday to regain control of capitalism,” he writes, “it must start by recognizing that the concrete institutions in which democracy and capitalism are embodied need to be reinvented again and again.” His contribution attends to the role of public debt, other financial investments, and the reach of empire as elements in the maldistribution of modern wealth. Scholars also trace fiscal and regulatory developments, from the rise (and fall?) of progressive taxation to the revisionary engineering of the New Deal. They consider how deeply finance has penetrated into daily life, including the ideological and political forces that made citizens into investors and the confluence of forces that sanctified home owning—and credit—as the path to the American dream.

Other writing identifies as transformative a radical redesign of money and finance that, during the Enlightenment, institutionalized the self-interested activity of investors as the compass for public systems. That experiment generated particular turmoil recently when a series of actions, many profit-driven, others unwitting, accelerated financialization.

Second, the new history of American capitalism targets the lived experience of people and groups as they assimilate—and reshape—the political economy they engage. No generic truck and barter here; scholars find instead distinctive regimes of interaction and peculiar modes of relation. They study capitalism in action.

This new focus lies at the intersection of two legacies from the historiography traced above—historians’ tendency to expand their subjects of study and their orientation toward methodologies tuned to the experiential dimension. Capitalism scholars today are interested in the narratives created by the interplay of a broad variety of actors, from those who organize businesses to those who consume, trade, plant, and work. They focus on actually existing capitalism, not the ideal types developed by various social scientists during the past two centuries.

One of the prime foci of social history, for example, was the history of labor. The history of capitalism picks up that interest but moves beyond wage labor in an industrial setting. Recent histories look at enslaved workers, sharecroppers, and other nonwaged workers and shift attention from the industrial cities of the Northeast to the nation as a whole. That approach allows scholars to interrogate the connections between slavery and the unfolding of capitalism. The project has undermined one of the deepest dividing lines of American historiography, between Southern and Northern history. The effect is to restore the centrality of violence and coercion to the history of capitalism while problematizing both liberal and Marxist understandings of capitalism as defined by its reliance on wage labor. At the same time, historians have reconceptualized commodification, sale, and ownership, recasting the market as a place of colliding human ambitions, fantasies of wealth, modes of resistance, acts of brutality, tenderness, and heroism.

Slavery’s relocation into capitalism is only the beginning point for a group of scholars studying racialization as an enduring American strategy for the coercion and control of labor, particularly African American labor. Race and capitalism is an expanding area, reaching subjects as varied Jim Crow, migration, urban studies, the carceral state, and black property rights movements. Approaches vary greatly, but many scholars attend closely to the subjects who receive, impose, resist, or recast race as a category. Their work erodes the image of exchange between equally situated agents and locates it in a field of power and culturally constructed valuation.

New histories reach other actors in the political economy, including shoppers, businesspeople, financiers, and traders. Thus Liz Cohen, in her Consumer’s Republic, looks at the ways consumers helped construct a new kind of political economy—through both individual preferences and politically informed collective action. By following the lines that join purchasers to those who market to them, fund production, and organize economic exchange, scholars have rediscovered financiers, industrialists, and managers, considering them not only as economic actors but also, and especially, as political, ideological, and cultural agents. Slave traders and New York financiers, Boston merchants, and Pittsburgh industrialists feature prominently in many of these accounts.

These accounts not only bring diverse actors into the narrative, they do so to quite different effect than older histories. Alfred Chandler’s approach, for example, sometimes presented businesspeople as almost powerless actors who could do little more than watch as modernity restructured American business enterprises. By contrast, new historians of capitalism present businesspeople as influential actors, but situate them within social networks. Scholars draw on Pierre Bourdieu, among others, to investigate how businesspeople accumulated not just wealth but cultural and political capital. The work on the rise of right-wing politics in the United States after the 1970s, for example, makes such political activities and identities of businesspeople visible, and sees them as crucial to the emergence of a new kind of political economy.

A third point of departure in the new literature concerns the production of knowledge. Sometime in the twentieth century most historians lost faith in the notion that they were intermediaries; it no longer seemed possible to conceive of the historian’s task as only translating the mysteries of a distant world for those in the present. Now the ways of knowing that held together a particular time, its events and ideas, mattered as well. Equally important was a historian’s own interpretative agency, her mode of creating coherence, which inflected the narrative in innumerable ways. History’s journey from self-identifying as an objective or naively empirical project wound through the pragmatism of the Progressive era, the critical existentialism of the mid-twentieth century, the efflorescence of social constructivism and the cultural turn in the 1970s and 1980s, through postmodern and postcolonial arguments about the subject.

One of the legacies of that debate is that historians of capitalism routinely subject to scrutiny narrative perspectives and conceptual orthodoxies, both their own and those of others. Modes of organizing and conveying knowledge themselves have become worthy subjects for query. The history of “disciplines, genres, paradigms, and other forms of representation” joins the study of social, cultural, political, and economic phenomena.

Drawing on an influential stream of pioneering works, scholars now problematize in particular the isolation of the economy as a subject matter and economics as a discipline. They have interrogated the relationship of the discipline of economics with the subject it studies and considered how models and images of the market claimed to communicate reality. Timothy Mitchell, for example, explores how the parameters of economic expertise shape the questions the discipline investigates, while others have scrutinized how data and statistics come to represent the authenticity of phenomena. Those studies amplify the argument, notably articulated by feminist scholars who early recognized that household labor had been read out of the record, that determinations about what is identified, measured, and counted create the “real economy.” As Susan Buck-Morss observed about the visualization of economic data, “In the crossing of the supply-demand curve, none of the substantive problems of political economy are resolved, while the social whole simply disappears from sight.”

In concert with that sensibility, capitalism scholars have interrogated the structures of belief, assumption, and culture that underlie the ascendance of credit, the embrace of speculation, and the legitimation of self-interest as a driver of human behavior. Legal and institutional scholars similarly seek to dereify categories that organize or enable exchange, including property, contract, money, and the classical dichotomy that divides the “real economy” economy itself from its “nominal” counterpart.

"New historians of capitalism present businesspeople as influential actors, but situate them within social networks"

Finally, the new history of American capitalism has often taken a more global perspective. That trend draws on the emergence of global history as a thriving research field, one in which economic issues play a central role. Flows of capital, labor, and science linked developments across oceans; trade bound national economies to one another; and financial institutions grounded in particular places colonized the capitalist global economy as a whole, connections that were overlooked by more locally focused histories.

Capitalism has not observed boundaries, and now neither do those studying it. Scholars currently working on American capitalism emphasize transnational flows of capital, people, ideas, and institutions, whether they are looking at trade relations in early America or considering the transnational history of neoliberalism. The rich literature on “varieties of capitalism” has fed that comparative perspective. And more recently, histories of various commodities—sugar, rice, tobacco, indigo, and cotton—have embedded the history of American capitalism in a larger global story of the spread and intensification of capitalism.

Within such a global perspective, however, the emphasis on understanding capitalism as a political economy counterbalances some of the more enthusiastic globalization narratives. No matter what the scale of analysis—local, regional, national, or global—the new history of American capitalism’s insistence on the importance of the state sees the global market not as an area outside public authority but as one shaped by rules, laws, treaties, and the distribution of power between states. Globalization and state formation constitute one another.

In the process of engaging these issues, historians of American capitalism have reimagined both the spatial divisions common to Americanists and the temporal frame of American history. The focus on capitalism has brought the history of the antebellum North and South into one narrative, for example, while scholars have attempted to integrate the West more broadly into an understanding of American capitalism. Similarly, issues raised by the history of capitalism transcend firm temporal markers such as the Revolution, the Civil War, or the New Deal, even as those events shape political economy in important ways. The project to understand how capitalism both observes and obviates borders at the global level has had, it seems, an impact even in the most local matters.

This volume is deeply indebted to long-running conversations between and within the disciplines. It is also indicative of changing understandings of American capitalism and approaches to exploring it. Invited to discuss the phenomenon of American capitalism according to their own lights, our authors spread out across the last three centuries of the American experience. They emphasized developments emblematic of the modern political economy such as bond markets, corporations, the concerns of wage labor, and the Commerce Clause, but they focused as well on subjects outside the traditional repertoire, including slavery, the rights of women, the utopian claims of late-nineteenth- century monopolists, and rationales that recast capitalism as a matter of state. As they worked, they created new approaches to American capitalism.

About the authors

Sven Beckert is Laird Bell Prrofessor of History at Harvard University and co-founder of the Program on the Study of Capitalism. He is the author of Empire of Cotton: A Global History (2014).

Christine Desan is Leo Gottlieb Professor of Law at Harvard University and co-founder of the Program on the Study of Capitalism. She is the author of Making Money: Coin, Currency, and the Coming of Capitalism (2014).